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Informist, Wednesday, Jan. 28, 2026

 

NEW DELHI – The Delhi High Court Wednesday issued notices to the Delhi Electricity Regulatory Commission and the Delhi government on Tata Power Delhi Distribution Ltd.'s plea against the Delhi Electricity Regulatory Commission (Supply Code and Performance Standards) (Seventh Amendment) Regulations, 2025. The petitioner said that the amendments compelled the distribution companies to finance government infrastructure works without the recovery of interest. The high court will hear the case next on Apr. 13.

 

While introducing a milestone-based payment mechanism, the Delhi electricity regulator has simultaneously deleted all provisions relating to interest during execution and compensatory interest for delayed payments by government departments, Tata Power Delhi, a joint venture company of the Delhi government and Tata Power Co. Ltd., said. As a consequence, the distribution licensees are compelled to deploy substantial capital from their own balance sheets for execution of government works, while being legally precluded under the prevailing tariff framework from recovering any interest, time value of money, or carrying cost, it said. The amendments thus shift the entire financing risk onto regulated utilities without any corresponding recovery mechanism, it said.

 

Tata Power Delhi said that although the amendment regulations, initially notified on Jun. 2, 2025, incorporated safeguards recognising interest during execution and compensatory interest for delayed payments, these safeguards were later unilaterally withdrawn without any public notice, notwithstanding the serious financial consequences for distribution licensees. The amendments, as they stand, effectively convert distribution licensees from regulated utilities into interest-free finances of government projects, requiring them to bear financing risk and cash-flow stress, while being legally precluded from recovering such costs through tariff or otherwise, contrary to the integrated statutory scheme of the Electricity Act, 2003, it said.

 

The regulatory framework also creates an impermissible and discriminatory classification between government departments and private consumers, the company said. While private consumers are required to deposit the full estimated cost upfront prior to execution of works, government entities are afforded preferential instalment-based treatment, with the financial burden shifted entirely onto distribution licensees, without any rational nexus to the object of the 2003 Act, the company said. 

 

Wednesday, shares of Tata Power Co. ended 2.1% higher at INR 355.05 on the National Stock Exchange.  End

 

Reported by Surya Tripathi

Edited by Saji George Titus

 

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